How the world works

[Cort Haus]

Originally posted by Sirotnikov
How is value dependant on the amount of workers is beyond me.

Value is a subjective thing, that is dependent on the possible consumers. This has almost no relation to the workers. Wealth is a matter of monetizing the value at a certain point and time.

This is the classical way of defining value within a market economy - how much someone is prepared to pay for something. This is helpful to an extent, as it sends signals about demand level, but it doesn't tell us much about the intrinsic value of a thing.

If you make umbrellas and there is no rain, your umbrellas are worth nothing. If it starts raining they 'magically' acquire value.

However, if you are deciding to make a product, you must consider your costs which will include labour time. If you are making product A, which takes 100 hours, and product B which takes 10 hours, product A has more something in it than product B. In Marxist economics, this something represents value, and while it might not tell us anything about how much someone wants to pay for it, it does tell us something about its intrinsic worth from a production point of view.

To take an artistic example, if a painter throws a can of paint at a canvas most people will know in their hearts that not much work has gone into it, however much the fashionistas say it is worth. Most people will recognise the intrinsic value of a skillfully-created painting that has taken hundreds of hours.

Neither measurement of value tells the whole story, as they come at it from different directions.

[Sirotnikov]

However, if you are deciding to make a product, you must consider your costs which will include labour time. If you are making product A, which takes 100 hours, and product B which takes 10 hours, product A has more something in it than product B. In Marxist economics, this something represents value, and while it might not tell us anything about how much someone wants to pay for it, it does tell us something about its intrinsic worth from a production point of view.

How much a product cost to make has no relevance what so ever to me.

What if I suddenly find a way to more efficiently make product A. Does it lower its intristic value?

What if product A took 100 hours to make, and product B took 10 hours to make, but they are the same. The factory of product A has lazier workers or a less efficient way of producing things.

According to your suggestion, the creators of product A should be rewarded, because it cost them more (in terms of labour) to make, even though they are inefficient. Why should I promote that? Why should i care at all?

There is no such thing as objective intristic value.

How much would you pay for a stolen picture of your deceased grandparents? Does it have to do with its intristic value, or does it have to do with your own needs and desires?

The cost of making a thing (it terms of capital or labour) is meaningful to the creator only. This obviously has an effect on the things eventual "cost" to the consumer, because a producer sets a price that will generate profit.

To take an artistic example, if a painter throws a can of paint at a canvas most people will know in their hearts that not much work has gone into it, however much the fashionistas say it is worth. Most people will recognise the intrinsic value of a skillfully-created painting that has taken hundreds of hours.

How about this:
person A is very talented and skilled.
It takes him a day to create a beautiful copy of the mona lisa.

person B is a lesser artist.
It takes him a year to create a goofy looking copy of the mona lisa.

Do you think anyone will pay more for person B's copy?

[Varwnos]

You cannot organise art in such a way, though. Apart from the inevitable complexity of any work, in the eyes of a beholder of it who likes it, there is the obvious existant market for very different types of art.
For example personally i dislike Tarantino's movies. I consider them to be cheap, thoughtless, junk-art. But others like them, so they have an audience. Sure there can be a film director who could create such a movie on the side, without any effort, but chances are he would not do it since he would have different visions/interests. So in the end the Tarantino movie would not have been made, when we already know that some people would be interested in watching in.

In other words you cannot view art only in terms of skill, since there is an audience for every different type of it.

[Cort Haus]

Originally posted by Sirotnikov

How much a product cost to make has no relevance what so ever to me.

What if I suddenly find a way to more efficiently make product A. Does it lower its intristic value?

What if product A took 100 hours to make, and product B took 10 hours to make, but they are the same. The factory of product A has lazier workers or a less efficient way of producing things.

According to your suggestion, the creators of product A should be rewarded, because it cost them more (in terms of labour) to make, even though they are inefficient. Why should I promote that? Why should i care at all?

There is no such thing as objective intristic value.

You may have misunderstood, so I apologise for not making it clearer. These are not the same products, with one being inefficiently produced, they are different products, one of which, say, is a sports car and the other is a shopping cart.

If you own a car company you will need to know both how much it will cost you to make it, and how much you can sell it for. As a consumer you might not care what it cost to make, but as a producer you need to know that.

[Cort Haus]

Originally posted by Sirotnikov

How about this:
person A is very talented and skilled.
It takes him a day to create a beautiful copy of the mona lisa.

person B is a lesser artist.
It takes him a year to create a goofy looking copy of the mona lisa.

Do you think anyone will pay more for person B's copy?

This is true, and I'm not saying otherwise. The quality of the work is part of the equation, along with time.

What I am talking about is if Artist A does the best Mona Lisa copy he can do in a day, and then the same artist does the best Mona Lisa copy he can do in a week. The one he spent on a week on should be better.

[VetLegion]

Originally posted by Cort Haus
However, if you are deciding to make a product, you must consider your costs which will include labour time. If you are making product A, which takes 100 hours, and product B which takes 10 hours, product A has more something in it than product B. In Marxist economics, this something represents value, and while it might not tell us anything about how much someone wants to pay for it, it does tell us something about its intrinsic worth from a production point of view.

Correct me if I am wrong, but Marxist theory has an important caveat with regards to this.

The problem with measuring value of something with hours spent creating it is that someone may be slacking off at his job.

To counter this problem, theory says that only (if I recall the term correctly) "socially necessary labour" is counted. And then the theory is fuzzy about this critical concept. Which renders it basically useless as a tool of economic analysis (unlike marginal utility and other neoclassical concepts).

[VetLegion]

Originally posted by Sirotnikov
I think it has been said many times, that humanity will evolve into two distinct groups - a group of smart and talented people, ideally also pretty and healthy (being smart makes them rich and being rich allows them to better choose partners).

And a second huge group of idiot mofos, that'll remain on the ape / street hoodlum level.

There is strong evidence in that direction. I recommend the documentary "Idiocracy" if you already haven't seen it.

President Camacho

[Nikolai]

Originally posted by Sirotnikov
I think it has been said many times, that humanity will evolve into two distinct groups - a group of smart and talented people, ideally also pretty and healthy (being smart makes them rich and being rich allows them to better choose partners).

And a second huge group of idiot mofos, that'll remain on the ape / street hoodlum level.

I'm happy there's no way that will ever happen.

[Blaupanzer]

Most all of us are semi-intelligent apes / street hoodlums. Money does not equal smarts, tho smarts sometimes put hoodlums in a place to make money.